Statutory Requirements

Federal

The purpose of CDLAC is to implement Section 1301 of the Federal Tax Reform Act of 1986 and Section 146 of
the Internal Revenue Code which impose a limit on the amount of tax-exempt private activity bonds which a state may issue in
a calendar year (i.e. the annual state ceiling). Section 146(d), as amended by the Community Renewal Tax Relief Act of 2000,
permits a state to set its annual ceiling at $187,500,000 or an amount equal to $62.50 per capita of its population,
whichever is higher, in calendar year 2001. In calendar year 2002 and thereafter, the ceiling will rise to $225,000,000 or
an amount equal to $75 per capita, whichever is higher. Beginning in calendar year 2003, the ceiling will be adjusted
annually for inflation.

The actions of CDLAC are fundamentally defined and limited by federal tax law. Federal tax law defines the
term "private activity bond"; limits the volume of private activity bonds which a state may issue in a calendar
year; defines the types of programs and projects which qualify for tax-exempt bond financing under the volume cap; and
specifies recordkeeping requirements.

Set the Annual State Ceiling:CDLAC is required to establish the state ceiling as
soon as is practicable after the start of each calendar year.

Allocate the State Ceiling:CDLAC is granted the sole authority for allocating
the annual ceiling.

Other Administrative Functions:CDLAC is authorized to prepare forms, establish
procedures, set priorities, require a performance deposit, assess fees, and perform other administrative functions as necessary.

Additionally, in establishing CDLAC the Legislature emphasized the substantial public benefit of promoting
housing for lower income families and individuals and of preserving and rehabilitating existing governmental assisted
housing for lower income families and individuals.